With a total budget of Rs17.8 trillion, Finance Minister Muhammad Aurangzeb will unveil the federal budget 2025-26 in the National Assembly today. He will present the Senate Finance Bill 2025, which has the Annual Budget Statement.

Salaried workers get some relief from the budget. It suggests a 10% pay raise for government workers. Pension for retired civil servants may increase by 5% to 7.5%.

Employees in Grades 1 through 16 will receive a 30% specific grant. Their fundamental pay will incorporate this and will replace earlier ad hoc help.

The administration aims to lower tax evasion and expand the tax base. Though providing little relief to salaried individuals, it hopes to raise revenue collection.

Pressured by the International Monetary Fund (IMF), the government is considering a new tax on farm income. Freelancers and others earning digitally, particularly from abroad, will also be taxed for the first time.

Shares and property’s capital gains tax is likely to rise. The government might also levy taxes on confectionery, fertilisers, and insecticides.

Simultaneously, taxes on tobacco and cigarettes may decrease. This is a change from prior budget plans that levied these more.

Once given tax breaks, the old FATA region could now have a 12% tax rate. This reform seeks to harmonise the tax system throughout the nation.

The budget plan draws both favourable and unfavourable reactions. One PPP head has proposed significantly greater increases—50% in salaries and 100% in pensions. The final decision will, however, be made during budget discussions in parliament.

The budget captures IMF criteria as well as local demands. It points in the direction of raising income while controlling rising costs.

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